Steve Moskowitz is the founding partner of Moskowitz LLP, A Tax Law Firm. Their tax law firm represents individuals and […]

https://capitalgainstaxsolutions.com/wp-content/uploads/2021/06/Podcast-Blog-Art-17.png

Steve Moskowitz is the founding partner of Moskowitz LLP, A Tax Law Firm. Their tax law firm represents individuals and businesses in tax controversies and disputes, tax litigation, international tax planning, criminal tax defense, tax investigations, offshore banking matters, and tax collection resolution.

He has been a tax attorney for more than 30 years. He has made it his personal mission to help business owners, or individual clients, successfully resolve tax issues that go on with their lives. He has extensive knowledge of tax law and a desire for swift and vigorous defense and decades of experience with tax authorities and in the courts. He has unusual perceptive judgment in assessing the best way forward and the right resources to achieve resolution.

 

Watch the episode here:

 

Listen to the podcast here:

 

Would You Rather Pay $1M Today Or 30 Years From Now With Zero Interest With Steve Moskowitz

 

Brett:

I’m excited about our next guest. He is the founder of Moskowitz, LLP and I probably pronounced that incorrectly but he’ll pronounce it correctly here in a minute. But he has been a tax attorney for more than 30 years, he has made it his mission to help business owners, individual clients, successfully resolve tax issues that go on with their lives. He has extensive knowledge of tax law and a desire for swift and vigorous defense and decades of experience with tax authorities and in the courts. And he has unusual perceptive judgment in assessing the best way forward and the right resources to achieve resolution. I’m excited to have him on the show. Please welcome to show me, Steve Moskowitz. Hey, Steve, how are you doing?

Steve:

I’m doing great. This is my favorite time of the year, it’s tax season. And I’m gonna have a good time because we’re gonna talk about taxes. As you know, we love to talk about taxes, who doesn’t?

Brett:

Exactly and I appreciate you coming in during this tough time here. Because it does, it gets busy, you know, for folks like yourself and anyone who’s a CPA and tax season. So that being said, let’s dive right in Steve, cuz we’re going to cover a lot today. Our topic today is would you rather pay $1 million, or 30 years from now with zero interest is kind of the time value of money. But before we go there, Steve, would you give our listeners a little bit more about your background and your current focus.

Steve:

I’m a tax attorney and I had our tax law firm before I was a tax attorney. I was a CPA. And I dedicated my professional life to helping people with taxes. And I have a heavy-duty background. And most people like me start with the giant firms that represent the fortune 500. And that’s how I started. And then I realized I could do so much more for small businesses and individuals. So 30 years ago, I went out and I started my firm. And it gives me to this very day such great satisfaction when somebody comes in, and I save them taxes and build their wealth. And there are so many ways to do that, for example, if we set them up with a retirement account, all of a sudden, they have to make the tough decision. Would they prefer to pay less taxes and put their money away in someplace safe? Or would they rather pay more taxes and have their money where they could easily have it taken away from them. So the bottom line is that gives me great personal satisfaction, and you grow with these people. And you see sometimes they come in with nothing or maybe a big tax problem. And all of a sudden you fix the problem. And then you start growing their wealth, and the things you talk about, and I’ve listened to your podcast, they’re so good because I’ve been espousing and stuff for years, like with the time value of money, I say, look how those banks made all those all that money, how they do that. It’s the time value of money because when you walk in the door and say you want a loan, they hand you money, how are they making money on that time value of money? Or when you deposit the money? How are they doing it? time value of money. And when I explained that to clients as you have on the graphic here, I say, if you had to pay a bill, and you have a choice, you could pay it today, or 30 years from today. And by the way, if you pay 30 years from the date, you won’t pay any interest. Which would you rather have? And the answer is really simple or the other way around. Would you rather if somebody says I’m going to give you a million dollars, would you like it today or 30 years from today? I would take that today. Thank you very much. That’s the time value of money. And that’s what you’re espousing. And it’s and it works so well. And so many people have made so much money. This is a basic financial principle. It’s very exciting. And I’ve heard you explained in a number of the podcast, how you make it work, because a lot of times when you hear something, it’s a teaser, you say, hey, you can save great money on this. Thanks. Time’s up and you explain. Well, here’s how you make it work.

Brett:

Yep, we’re gonna dive all into that. I’m so excited because I feel like some folks on the episodes are in the same field. And, and you are so we’re gonna dive into that here in a second. Now, I want to take a step back though. If you know Steve, I believe we’ve all been given certain gifts in this life and these gifts are given to us to be a blessing or help to others. Some people call them superpowers. Some people call them strengths. I want you to pitch yourself in university days or high school days, you know, and, you know, maybe identify one or two gifts that you believe you were given, and how those gifts help how you help people today.

Steve:

Let’s go back to university days, I was a professor for 10 years. And one of the things that I would talk to people and whether it was in law school, or graduate school or university, one of the gifts is helping somebody with their career, because a lot of times people were saying, Well, what career should I take? Should I do this? Should I do that, it will take a whole lifetime. And it’s been a long time. to clap. Today, some of those students were my students 25-30 years ago, and still, come back and say, Hey, Steve, I did what you said, and look at my career. Now, once again, great personal satisfaction. And that’s what I try to do with business. You know, I’m not some guy that says, the code provided under regulation 1234, that you must push this lead makes you crazy, don’t hear it. But instead, say, look, you know, the law and business and tax lives, and one thing are about taxes. Everybody understands that one of the purposes of the tax law is to get money. But for most people that’s only one purpose, there’s another purpose to the tax law that most people overlook. In a democracy, the government can’t order us to do things like Okay, Mr. Business person, you have to buy this machine or buy this building to do this. But they want us to do it because it’s good for the economy. So how does the government get you to do something that they want you to do? But they have no power to audit, they give you a tax incentive. So sometimes when people say, Well, wait a minute, how can the fortune 500 make billions with a B in profits and not pay any taxes? And here I am, little guy and I’m paying all these taxes? How can that be? Because the government says, Well, wait a minute, there’s economic good here, if you go ahead and buy that machine, or you do this, or you do that, there’s benefit to society’s benefit. So what I’m saying is, that’s what tax planning is saying, okay, the government in their infinite wisdom said, If you do this, there’ll be a tax benefit, you take advantage of them. And a lot of times, it makes good business sense to do something with a sometimes really just a tiny change, you have tremendous tax savings. And that’s what I’m all about. Because I made the shift from being a CPA to being a tax attorney, I was a CPA, before I set foot into law school. So when I, when I switch, we still do to turn white I switch. Because I want to be the guy to say, look, you can do this in this in this to me what tax is all about, you spend a year of tax planning, tax return itself, it’s merely a summarization of that year of tax planning, where when I was working as a CPA, an awful lot of the people were just okay, you get a bunch of forms, and you move the numbers from this paper, too much more about it, and you see what you can do with tax planning. It is astounding. But there’s a lot of things that are hidden in the tax law. So think about this, envision your desk, and suppose your desk was empty. And I put one piece of paper on the desk, and I said, you look to your local IRS office and claim a million dollars. But this piece of paper, I’m sure you pick up the paper and you take it to the IRS. What is this, I put this piece of paper on your desk, the same piece of paper. And then I backed the truck up to your desk and I dumped a million pieces of paper on your desk. Now, you never take that one piece of paper, that special piece of paper to the IRS. And you said well, why didn’t you take it, it was right there was on your desk because you didn’t see it. If you understand that you understand our tax law, there are that million pieces of paper on there on your desk, and there’s that special one that’s buried, you have to know how to find it. And that’s part of what I’ve dedicated my career to. Because for 30 years, you know, when you get into this and you learn and you say well wait, there’s this law that we know where that special piece of papers hiding was you look at your desk, your head swim, you say, Oh my god, there’s a truck backed up, there are a million pieces of paper on my desk.

Brett:

Very well said in a great analogy, which leads into the topic, would you rather pay a bill today for a million bucks, or 30 years from now is zero interest. So one of the biggest things with the deferred sales trustee that we get is, you know, we’ll want to have to pay this tax, you know, at some point like yeah, if and when you receive the funds from the trust, right interest payments, you’ll pay ordinary income if you dip into principally play some capital gains tax as you receive it. By the way, the same thing as a 401k. Right, the same thing as an IRA, very similar, the same thing, even like a 1031 exchange if you have a boot. And so understanding the time value of money and tax deferral, right, what that can do for you and help you create and preserve more wealth is what we’re you know, we’re talking about here, along with though, along with and I’ll just jump in, adding the dirt, the ability to diversify and stay liquid right. So that I found with you know, Chaired Orinda Trust, 1031 Exchange, Delaware Statutory Trust, versus the Deferred Sales Trust, all the other ones either giving it all away to charity, or you’re not able to diversify, right, you have to sell real estate, low or high and you know, buy it higher 180 days later with a 1031. Right? Or go into like a Delaware statutory trust, which is just another form of 1031. So would you just expound upon time value money, but plus the ability to diversify and be liquid with it with the investment? 

Steve:

You know, the reason I was smiling when you were saying that the example that you gave is the exact example I give, when I’m talking about retirement, sometimes the client says to me, Well, wait a minute, if I put the money in a retirement account, when I take it out, don’t have to pay tax, then and I say, Okay, let’s look at this example. Suppose that you start and you put 100 grand into the account. So we save taxes. And years later, your account has grown, and bear in mind that all the earnings there are not being taxed while they’re being earned. So they grow faster. Now you have a fund with a million dollars in it. And let’s take the worst case, let’s say when you retire, the tax rate was half 50%. You pay half a million in taxes, you have half a million left, would you rather have that half a mil? Or would you rather have the 100 grand? Oh, that’s how it works. That’s the way I explained retirement accounts and tax on.

Brett:

So now expand upon the ability to diversify, because it’s not just the tax deferral strategy, but it’s the investments behind that and making sure that you can put it into, you know, different vehicles at different times and spread that out.

Steve:

Well, sure. Yeah, basic, you know, basic planning with financial, and it goes way back to fairy tales. Don’t put all your eggs in one basket. And the idea is that if you diversify, it’s extremely unlikely no matter what happens in the markets, that everything would go bad. It’s like, no matter that the reason you have a market is that somebody thinks something’s going up. And another person thinks the same thing is going down. And no matter how bad things are, somebody makes extra money. For example, right now in a pandemic. Could you imagine if you bought zoom before the pandemic?

Brett:

You’d be doing great right now!

Steve:

Oh, my God. Well, you know, it’s not just zoom, it’s, you know, you look at Amazon, and you look at some of the others. So what happens is, it’s not that everybody goes down or up. It’s choosing wisely and getting in at the right time. And then saying, Okay, this is how it is regardless of the conditions, I’ve made money.

Brett:

Excellent. So now let’s dive into just overcoming false beliefs. So someone comes to you, Steve, and they’ve never heard of it. And Steve, there’s their CPAs Never heard of it. Right? And it seems like it’s too good to be true. Steve, everyone, I’ve known about it, what’s your best way to help educate and help bring somebody along? But sometimes these deals are time-constrained, right? Where you have like, 30 days to make a decision, right? We need to do tax planning, typically, especially for highly appreciated assets before the close of escrow even before contingencies have been removed. Right. So walk us through. Yeah, yeah. So give you that. So yeah, 30 days, it’s a $10 million sale, it’s a business sale, it’s going to cost the guy 4 million tax. He just heard about, yeah, he calls you what, give us a tizzy in 30 days, how you’re helping him overcome the false belief that it’s too good to be true. 

Steve:

You know, that boy knows an awful lot of overlap between what you do. And when I do, because I hear that all the time. He says, my CPA never heard of that. And I said That’s why you should switch away from him or her. And so many times, I heard somebody come in as a deal-breaker. And remember going back to my example. That’s why I went to law school when I was a CPA. 

So he’s too good to be true. So like anything else, you take a look at it. It’s like, right now the government is in, we can talk about later, and is giving away a lot of money. free money. So what’s too good to be true, but that’s what the law is now. So what you want to do is you want to say, Well, wait a minute, if you haven’t heard of something, you want to go to somebody that does and say, Well, look, let me prove it to you. Let me tell you what’s going on here. And in my practice, that happens all the time. Another thing I’ll get all the time, is somebody says to me, is this No. And I was around for years. Well, my guy never told me about that. He said, Well, that’s why you’re in my office instead of his or her office.

Brett:

I like it. Yeah, exactly. Put it back on. That’s why you are here. If he already has told you about it, he wouldn’t have called me right. You wouldn’t be in this situation. He would have solved your problem. Yeah. And then and then I also like to tell them, you know, track record or something right. You know, in the deferred sales trust standpoint, 1000s of closes over a dozen no change. IRS audits, billions under management go back 25 years, but it is proprietary and is protected. So it’s kind of we’re in this. We’re in this zone where it’s known by a lot of people and those who have done it, but it’s also protected and proprietary. So we don’t give away our secrets. Part of it because we don’t want the competition. But the other part of it is we don’t want anyone to abuse it, right? Because we don’t want anyone to go outside the guardrails. So talk about going outside the guardrails and some of these things and, and maybe in the past, why things have maybe even the IRS has tightened up, or maybe taking them away, what’s your thoughts?

Steve:

I will in just a sec, but something else you said that it’s so very important. Another reason what you do is so important, and why your shows are so important is you can’t utilize something if you don’t know what exists if you were off in the world. And you know, both you and I are wearing eyeglasses right now. And if we didn’t know that eyeglasses exist, we’d say well, can’t see very well. And that’s that. And then some guy comes from the civilized world and says, Hey, all you need to do is get these eyeglasses, and you can see 2020 so part of what you do and part of what these podcasts are all about is saying, Hey, here’s the eyeglasses, you really can see 2020 I know you never heard about eyeglasses, I’m going to introduce you to them. So what happens is like, like everything else in life, and as much as tax, somebody comes up with somebody, something, but somebody always abuses it. So you say, okay, you can drive along this highway at 80 miles an hour because the roads are special. You know, there’s going to be a guy zooming around at 120. And you say, Well, wait a minute, why? Why is it that this guy? Now, why are the police patrolling and pulling me over? I was only doing 90 because somebody came on and abused it. So what the guardrails are, you have something and say, Look, here are the rules. But like anything else, that’s like, having a fine bottle of wine. That’s, that’s wonderful with dinner. But when you finish it, you don’t get in your car and drive home, you get in the backseat of somebody else’s car. And that’s why you have guardrails.

Brett:

Very, very well said. So now, now, maybe we can touch on something that you offer, cuz I’ve been kind of plugging the deferred sales trust here. And what’s something that helps with the highly appreciated asset? asset sales? And let’s just take a primary home, let’s say, in the Silicon Valley, right, someone selling a high-end primary home, they come to you, Steve, and say, Hey, I’m out of my 121 exclusion about this property 25 years ago, for a million, it’s worth $15 million. I don’t want to do a 1031 exchange, I can’t do a 1031 exchange, Steve, what do you have to offer me?

Steve:

So then what we do and one of them I think one of the strongest things we have to offer is we don’t have a one size fits all, here’s the blank form, we’ll put your name up top, what we do is we do an analysis. And the example that I give here, is I have twin siblings. their income is identical, everything’s identical. But you know, what we do for the brother might be very different from what we do for the sister because we say to him, Well, wait a minute, what do you want to do? And that’s so important, because a lot of times tax planners, they’ll come up with something great. And then, later on, somebody comes to me and says, Oh, my God, can you undo this miserable? I hate this. And sometimes you’re going to do something and somebody says, Well, you know, sometimes irrevocable does mean, irrevocable. So what we do is we not only just get in, well, here’s the tax law, here’s the device, what do you want to do? And you say, Oh, well, now that I know you want to do this, this vehicle would serve you the best. And I think that’s the strongest part is what I like to do old-fashioned, sit down with somebody and talk to them in what do you want to do? And then tell them what you can achieve, hey, if you want to see off in the distance, well, besides the eyeglasses, we have some binoculars here. So you really can see those birds in the trees. And you want to go and sit by the ocean. And then you talk to people, for example, even with estate planning, some people say everything for the kids, everything for the kids, I think other people will say, and some very, very wealthy people, I won’t mention the names of famous people from the news will say, you know what, you give money to kids, you’re ruined them. So, again, the tax planning or the estate planning for those people are very, very different. But I think one of our strengths is we find out what you want. And you know what people say to me all the time, say, Steve, I’ve been doing this for years long before I met you, I these other guys, nobody ever talked to me. You just simply talk to me, you’ll find out what I want. And then we put them into things that not only save them taxes and are good for their investments but are taking care of their wants, needs, and desires.

Brett:

So make sure I capture that. And it’s it You said it so succinctly and clearly here. So what do you want to do? Like what is the outcome for you here? Like what do you envision your wealth plan your life, your time, your energy, your family, your state planning? Start with the end in mind, and work your way back? Is that a fair summary?

Steve:

Yes, it is. And we have all types of things where I like tryouts. For example, Sometimes you’ll hear somebody saying, You know what? I’m working hard. I’m working at 1000 miles an hour. So one day I can sit on the beach and do nothing else. Wait a minute. But that’s fine for some guys. But that kills other guys, do you want to do that if you worked hard all your life? So one of the plans that I talked to people about is it would be for you to pull the plug, take a week, a month, you take off a week, a month, how do you like it. And if you find that you enjoy that vacation the week, a month, take two weeks a month, three weeks a month to you’re finally ready to pull the plug. But if you’re at two weeks a month, and you’re saying, you know what, I’m checking my email every five minutes, I’m pacing the floor. I’m bored. I say every time it’s not for you. So then we change their plans accordingly. And then you take a look at Well, okay, what is your spouse want? Now another one that comes up is sometimes there’s a conflict with the kids, we’ve dealt with that too. Sometimes what the kids want is best for the kids. But it’s not best for mom and dad. And I’m representing mom and dad. Now if you want to do family planning, that’s fine. But if I’m representing Mom and Dad, I know you love your kids, but what they’re encouraging you to do is great for them. But it’s bad for you. And I just tell him that. But again, before I get to the formal stuff, the rules, the regulations, all the complicated stuff. It’s old-fashioned, sit down and talk to somebody and find out what you want? And then say, Well, okay, do you want it? Is there some way I can sample this? I’d like to have this food before I order a truckload of it. Load up the space capsule. And so you have the do really like this? Let’s try it out. And sometimes you can.

Brett:

Excellent. I like that. Because it’s something I can sample this. And sometimes the kids do what they want, not necessarily what’s best, even for their parents and or for the family, I certainly can see that. What’s the biggest overlooked, I guess, challenge for ultra-high net worth individuals with the kids and the spouses that you just see consistently happening on that topic?

Steve:

Pressure, pressure from the kids. And I’ve seen parents say what my kids want this, I said, but they’re not the ones that earned it, what do you want, they have their whole lives to earn money. And look, they’re coming from your family, they already got a good start. But what they want is, is not the best for you. And you don’t have as many years as they do. And I see that all the time where people will come in. And I’ll say, Well, why won’t you do that? Well, my kids said I should. Well wait a minute, who am I doing this for you with the kids? You’d be amazed at how much resistance was but my kids said, I said I understand. But the difference is with me, I’m independent, where I truly want your best interest, I have your best interest, by the way, I have a legal duty to have your best interest. And when you devise these plans, I’m not the beneficiary of the plan. So when I say to you look, I recommend doing X instead of y, there’s a benefit to it, as opposed to somebody that’s selling y and said, Look, you should go ahead and do y.

Brett:

Yeah, very, very insightful and makes perfect sense. Who am I doing this for? Am I working for you or your kids? Or both? And if it’s both and let’s bring them all in and let’s all sit down. But if it’s for you, you’re making the decisions? Is that a fair summary then

Steve:

And be real careful if you sit them all down because you’re in a conflict city. So you people can knowingly waive a conflict. But a lot of times they will look, you know, there’s a reason why sometimes a lawyer takes sides as we do most of the time. Because what’s better for one is for more for one, zero-sum game. More for one is less for somebody else. So we have to be careful about that. And then you start another thing that I’ll talk about is practicality. Whereas the numbers increase, sometimes you can do something that you wouldn’t do for somebody who had smaller numbers because of the practicality of the case. And what the people want to do. So for me, I’m always looking at the lifestyle. And I’ll never start and I was working for a big firm in New York. There was this financial guy that made me nuts. And I hated his advice. And I remember, you know, brand new, and his financial advice when the price of steak goes up, eat eggs for dinner. I said, But wait a minute, and what if I don’t want eggs for dinner, and that doesn’t give me enough nourishment. And I’m tired. The next day, he was just looking at just the numbers, just the price, nothing else that the eggs were less expensive than the steak. I said, there’s so much more to it. And that’s one of the things that we offer clients, we don’t just look at the bare-bones numbers, it’s what’s behind them. And back when I was a law school Professor taught a course in that and I said, if you look at a financial statement, and you don’t understand what’s going on, you can get taken to the cleaners for example. Suppose you take a company that is running well and everything is well maintained. Then you have somebody come in and he says okay, I’m going to increase profitability in the company. So what I’m going to do is I’m going to order a stoppage of all maintenance on all machines. So the machines are when I walk in the door, they’re well maintained, they can go for a while, without any maintenance, I’ve saved the money in the maintenance. And what I have to do is get promoted before all the machines break down. So I’ll say, Look, I’m so great, I made you all this more money. And now I get promoted up, the machines all break down. That’s the next guy’s problem. And the new lawyers that oh, my God, and you take a look at what these financial statements mean. And when I taught that course, in law school, I opened up a lot of eyes, because people would look at the financials and think it’s something it’s not even, for example, looking at the balance sheet, and understanding the difference between fair market value and cost. For example, if we looked at the balance sheet, suppose, we looked at the original purchase of Manhattan Island for $24. And suppose we still have the original owner having it on his balance sheet, he would show Manhattan Island $24, I say, look, the balance sheet says $24, don’t sell that for $25. Don’t sell it for 2400, don’t sell it for 20 for a million. My God, fair market value is so different than, you know, book value. And then we talk about other things, for example, the time value of money. We love doing cost segregation analysis for clients, where and that’s one example I give somebody buys a commercial building, and they say, Well, I have to depreciate this over 39 years, or residential 27 and a half, say, Well, wait a minute, we can come in do an analysis. And yeah, there’s some portion, it’s 39, or 27 and a half. But some’s 15, and 10, and five, and someone can write off Now, again, an awful lot of what I do goes back to the time value of money. It’s not just pensions, other things still. I get excited about this because who wouldn’t?

Brett:

Yeah I know, I geek out on it too, I think our listeners too appreciate all of your wisdom here. So now I want to go back to the thought you made about somehow I can sample this right. So this is interesting, right? So some of these tax deferral strategies, right? Again, irrevocable, you gotta set up beforehand, you’ve got and then you close, and it’s kind of like, you’re not going back unless you’re gonna, you know, pay the tax, at least that’s what is definitely for the deferred sales trust as you receive it. So what’s a way that you can sample some of these tax deferral strategies or some of these strategies without having to do them quite yet?

 

Would You Rather Pay $1M Today Or 30 Years From Now With Zero Interest With Steve Moskowitz

Would You Rather Pay $1M Today Or 30 Years From Now With Zero Interest: “The more you know about your customers, the more you can provide to them information that is increasingly useful, relevant, and persuasive.” – Jay Baer

 

Steve:

Sometimes, I will go ahead and set something up. And then just say, let’s take some time, come to me, let’s take some time. And think about here’s another one that I’ll get. People especially sometimes medical doctors will come in and say, you know, what, they get sued all the time. And they want to set something up for asset protection. And there are all kinds of asset protection trusts you can do. And there’s, you know, all kinds of islands to put things. Excuse me, but you want to do this. Because if you’re doing it properly, it’s not a wink to somebody that well, but is if you’re doing this, you’re taking this stuff away, maybe you don’t want to do it, maybe it’s something as simple as getting more insurance. Or maybe it’s something as simple as knowing what you do 10 different things. And one of the things you do, the malpractice rate is high. Stop doing that. Let somebody else’s client do that. So it’s, it’s not again, I look outside the numbers. And to me, that’s the big, big deal. Because in my career, what I see all the time is you guys present these nice numbers. So always Nice, nice. Well, if you do this, you’re protected from that in this, but what’s behind that. And that is essentially a sampling. And sometimes when I do these things, I say, Well, look, let’s just wait a little while and see, if you call up like with the asset protection trust, what you’ll see is somebody gets sued, and they run to the lawyer and say, I want to set this up. Well, first of all, it’s too late when you get sued, but you’re in the passion of the moment. So I say, Well, wait a minute, let’s take a look at it. And then when we get through this suit, what do we want to do? So it’s a combination of looking things. And again, my whole career, I’m just amazed by the fact that the guys are just looking at the numbers, just looking at the cold papers, or now the cold computer screens when they’re not looking at what’s behind it. And it goes back to what you want to do. And the other thing is, you know, I told you, I had been a professor, many years ago, I like to explain things to people. And a lot of times I’ll talk to people, they’ll bring a stack of papers and say to me, Well, you know, I never really understood what I signed. I don’t want to say that I represent it. I want to partner with him and say look, the reason you’re doing this, so if somebody does something, they understand why they understand the benefits, and are there some determinants that we want to watch out for and how these things weigh themselves? If you’re talking to a medical doctor, and there’s a medicine that will help a condition, you have to understand the side effects before you swallow that pill.

Brett:

Perfect. Yeah, that’s disclosing the detriments, clarifying what it is, what it’s not, and exhausting the other potential solutions to that, right. So in this scenario for something who’s selling a commercial real estate building? And it says, What do you have other buildings? Yeah, I have some other buildings. Okay. What have you done? Have you done a straight line? Or cost seg on those, I’m just doing some straight line. Okay, great. What did you buy that building just a couple of years ago? Why don’t we just do a cost segregation study on that deal? And if you sell this one, I’m gonna be able to offset it in the same year. And that could, that could have some saving. So it’s about looking out for their best interest looking behind the numbers, and then finding out truly what they want, making sure they want it before they go. Is that a fair summary?

Steve:

That’s a good summary.

Brett:

Excellent. All right. So let’s, uh, let’s move into the biggest frustration when it comes to capital gains tax deferral options. So what would you say the number one is for your clients when they’re selling highly appreciated primary homes, investment, real estate?

Steve:

Oh, that comes up all the time. You have some nice couple that when they were young, 40 years ago, they bought their house and they had their kids. And now it’s 40 years later, and the kids are all gone. And the $100,000 house they bought 40 years ago is now worth 10 million, and say, How much did you say those capital gains taxes were? And then they choose of? Well, do they want to live in someplace they don’t want to live in? Or do they want to pay capital gains tax that they want to do? Or what can they do? And that’s where what you do comes in is so vitally important.

Brett:

Yes, so the frustration is selling the house, that’s highly appreciated. We just did a deal in Palo Alto for 8.3 million for a seller and we saved him nearly a million dollars in capital gains. Second, I say defer is the best word to use. And he was able to move and relocate and then do the things that he wants to do. And otherwise, he’s like, I have to rent this thing out for two years, I don’t want to move out and try to rent this highly appreciated property I want to sell today, or to give it to charity. So he said, You know what, I love the deferred sales trust. I thought it was too good to be true. He brought a CPA and we did the deal. And it was a win-win for everybody.

Steve:

You know, there was, you know, there was a professor in law school, he would just put on love. And he espoused something that you talk about today. And because what he said is, I’d like to borrow some money from you. And you can charge me any interest rate you want. And I’ll agree to it. If I can write the terms and his terms, they were always payable in full in 1000 years. charged me 3,000% interest, I’ll pay you in 1000 years. And that is what you’re espousing here. And again, when you simplify it like that, you understand the value of what you’re doing.

Brett:

Yeah, 100%. And just to clarify, too, we always want to make sure things are commercially reasonable. So we set our terms for 10-year notes. And if 10 years, though, you can renew for 10 years, and then we can re-renew passes to your kids, your kids can keep going as well. You can learn more about capital gains taxation calmly, but we’re talking with Steve and pronounce your last name Steve. Moskowitz. Yeah, Steve Moskowitz, and you can find him either he’s in the Bay Area. He’s in Oakland, kind of the San Francisco area. He can find them at MOSKOWITZ. LLP, calm. By the way, Steve, that I tell you, I’m originally from Mission San Jose Fremont. And we would spend our spring and summer times, taking the BART into the Oakland A’s stadium. And seeing Mark McGwire, Jose Conseco hitting those home runs. I don’t know where you were in the 80s. And the other one was, of course, Jerry Rice and Joe Montana with the 40, Niners. That’s where I’m from, are you from there too?

Steve:

In the 80s. I was here in San Francisco because we have offices in both San Francisco and Oakland to serve both sides of the bridge. But before that was New York City. The bottom line is, you know, I have both references. But yeah, I remember all of that.

Brett:

Beautiful. So what seems or do you have? Do you have time in your tax, your tax practice, CPA practice? Do you have a team or two or where are you in New York? Are you in San Francisco?

Steve:

Oh, definitely San Francisco. I’ve been in San Francisco for over 30 years. When I first moved here, everybody asked me what they said, so the New York teams in town who you’re rooting for, and I said, I live here now I root for the home team and I’ve been in San Francisco for over 30 years. So I’m a real San Franciscan now. That was nice coming from New York. And what a lot of people say is, I still have a lot of New York City in me. probably tell from the way I speak.

Brett:

No, absolutely. I love New York City in you and thank you so much for sharing that. All that being said, Are you ready for the lightning round?

Steve:

Absolutely.

Brett:

All right. Knowing what you know now, Steve, you could go back to your 25-year-old self, what’s the one Golden Nugget? You would make sure you tell yourself what to do?

Steve:

Buy real estate in San Francisco, get everything you can get your hands on, and then do a deal with you.

Brett:

Thank you. That is flattering. Second question, favorite book or quote or favorite book that you have gifted or read in the last year?

Steve:

Oh, the Internal Revenue Code.

Brett:

Hmmm. The IRS tax code.

Steve:

There’s a long story behind that, but I can’t time the lightning round. I’ll tell you if you let me back.

Brett:

Okay, next question. Um, best real estate deal you’ve ever done.

Steve:

Gee, my own house where I bought it 30 years ago here in San Francisco. And I know what I bought it for. And I know what it’s worth. Now. That’s, and the beauty of it with the house is it’s a nice place to live in, I enjoy it. Because what I always wanted was a water view. So if you came into my home in San Francisco, I have a beautiful view of the Pacific Ocean, it’s something I always wanted, I enjoy living here, yet, it’s a wonderful investment.

Brett:

That’s beautiful. I have a client, I sold an apartment complex, we’re here in Sacramento in Folsom. And he has a water view, um, just kind of the base of the bridge. Closer to the city, not not the other side towards the beach. And it did, he has four kids. And guess what one of them wants to do. One of them wants to move into the place, right? The other one doesn’t care. The other one wants to renovate the place, right? And the last one wants to, I’m not sure what he wants to do. But the point is, he’s like this estate tax thing he’s like, is in the planning and he’s like, you know what, it’s just stressful because the kids want this, I want that I got I inherited from my parents, you know, it’s been in the family forever. And I’m stressed out about this, you know, and I have all the capital gains tax. And so anyways, all that being said, these are the types of situations that…

Steve:

Between you and me, we could relieve all the stress because of my part, I’d say, Hey, this is a no-brainer, you do what you want. The kids are on their own, then we turn them over to you and you save the money.

Brett:

There it is. I think that’s a win-win for everybody. Yeah. So Second, the last question, what are you curious about right now.

Steve:

I’m curious about the economic recovery of our country and what this pandemic is going to do to small businesses.

Brett:

Me too, me too.

Steve:

However, with what President Biden signed on March the 11th 21, I think this is a real chance for a lot of businesses are get ready to say they give up. And they’re just going to lose a lifetime of work and savings and look at a mountain of debt to come back and recover. So I’m very, very in favor of this, this new law which has come up.

Brett:

Excellent. Yeah, that is great news. To hear. and hopefully, It feels like the worst is behind us, you know? Yeah. So thank you so much for sharing that last question. After all your success. Steve, being a CPA and a tax attorney, helping countless individuals create and preserve their wealth tax, and with wealth-building, what’s the best way that you found to stay centered in your values, and stay encouraged to reach forward and charge for new goals

Steve:

By taking a walk along the ocean, and thinking about the beauty of the creation, the physical beauty of where I am, and what I can do to help people and that just totally re-energizes me.

Brett:

Taking a walk and taking it all in all the beauty of the creation and, and thinking about how you can help more people out. Absolutely. Beautiful. Love it. Steve, I want to thank you for being on the show. I want to thank you for sharing a bit about your story. So much wisdom. I can like I just took pages and pages of notes here. So I’m excited to perhaps have you on at a later date as well. 

Steve:

I love it. I had a great time doing this with you.

Brett:

Awesome. Cool and for our listeners would remind them one last time where they can find if they want to reach out to you?

Steve:

They can call us at 888-TAX-DEAL. That’s 888 TAX-DEAL or Moskowitzllp.com.

Brett:

Excellent. Steve Moskowitz thanks for being on the show and I also want to thank our listeners for listening to another episode of the capital gains tax solutions podcast. As always, we believe most high net worth individuals and those who help them they struggle with clarifying their capital gains tax deferral options, not having a clear plan is the enemy and using the deferred sales trust or hitting with someone like Steve Moskowitz to help you devise an estate plan tax plan is the best way for you to create and preserve your wealth. Please rate review, subscribe to the show, and go to capitalgainstaxsolutions.com if you want to learn more about the deferred sales trust and how that can help you and or one of your clients deferring capital gains tax. Hey, we appreciate you out there. Have a great day. Bye!

 

 

Important Links:

 

About Steve Moskowitz

Would You Rather Pay $1M Today Or 30 Years From Now With Zero Interest With Steve MoskowitzSteve Moskowitz knows that clients’ lives – and livelihoods – can be upended or even destroyed when tax trouble arises. As a tax attorney for more than 30 years, Steve has made it is his personal mission to help business owners and individual clients successfully resolve tax issues and go on with their lives. With extensive knowledge of tax law, a desire for a swift and vigorous defense, and decades of experience with tax authorities and in the courts, he has unusually perceptive judgment in assessing the best way forward, and the right resources to achieve resolution.

Steve started Moskowitz LLP because he saw that while big corporations were consistently navigating the tax code to their advantage, smaller businesses and individuals were not. With prior experience as a CPA at a national accounting firm, and with extensive experience in the corporate world, Steve knew he could help smaller businesses and individuals by applying what he knew, and wanted to make the critical difference in businesses and individual lives that protected them from the powerful government and enabled them to keep and enjoy the fruits of a lifetime of work that otherwise could be taken away from clients by the government in just one action.

Today – together with a full team of tax attorneys, CPAs, enrolled agents, and other professional staff – Moskowitz LLP helps business and individual clients across the country and overseas to resolve a wide variety of tax matters. The Moskowitz LLP team also creates strategies to utilize the tax code and relevant treaties to clients’ benefit and provides ongoing tax support and tax return preparation.

Steve understands that clients need high-quality representation but do not have unlimited budgets, and that cost predictability is important. Unlike most firms, Moskowitz LLP clients pay a flat fee and are not subject to hourly rates.

Love the show? Subscribe, rate, review, and share!
Join the Capital Gains Tax Solutions Community today:
Share This